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Zango zapped in first part of PC Tools legal battle

Adware vendor gets mauling from U.S. judge

By John E. Dunn
June 7, 2007 12:00 PM ET - Adware company Zango has lost the first part of its legal battle to stop antimalware company PC Tools flagging its software as potentially troublesome adware.

In a judgement, U.S. District judge John C. Coughenour, dismissed Zango's main complaint that the antimalware company's classification of Zango as adware had been unfair to its image or business, pointing out the notoriety of the company's software.

Last October, The U.S. Federal Trade Commission (FTC) was reported to have come to an agreement with Zango, formerly 180Solutions, to pay a fine of $3 million as punishment for allowing the Zango Cash Toolbar to be used to serve unsolicited adware to millions of users.

Zango has acquired a poor image among spyware and adware watchers, and has been used as a component in a number of scams initiated by third parties using the platform. PC Tools currently classifies three of Zango's programs as PUPs (potentially unwanted programs).

"Its [PC Tools'] classification is not unreasonable given Zango's past conduct and in light of other companies' similar classification of the plaintiff's software," concluded Coughenour.

PC Tools CEO Simon Clausen was critical of Zango's motivation for launching the legal suit in the first place.

"Zango's attempts to pursue and compel us into reclassifying through legal action, rather than following due process, is not going to get them anywhere — and is certainly not the way to rehabilitate their image," he said.

"It is our duty as a security company to provide consumers with the most effective product we can. We will continue to be vigilant in our classification of threats and will not be intimidated by these types of lawsuits," he added.

The defeat is unlikely to stop Zango from defending itself in what looks like a concerted attempt to change its image. The company is already unusual for having brought the lawsuit at all, and has also granted interviews with journalists to defend itself from accusations of wrongdoing.

Spyware researcher Ben Edelman has posted extensive notes on the Zango program and its behavior on his Web site.

Reprinted with permission from Copyright 2012 IDG, all rights reserved.
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